NY Lawmakers Work On Racetrack Bill

Bill would allow tracks and off-track betting corporations to work together.

State lawmakers in New York are trying again to get legislation approved permitting tracks and off-track betting corporations to work together on race date start times and simulcasting schedules without worrying about violating antitrust statutes.

The legislation, which on Feb. 4 was unanimously reported out of the Senate racing and wagering committee, has been somewhat altered since Gov. Andrew Cuomo vetoed a similar measure in 2011 when he said no public interest would be served by the measure.

The bill's sponsors say the measure is necessary to help tracks and OTBs to combine forces to deal with declining handle by being better able to market their product without directly competing with each other during certain times of the day.

"Making such join cooperative arrangements may lead to better national market penetration of the state's racing products and help to reduce overhead costs and competition among New York's racing producers so that OTBs can effectively market each racetrack's products," states a legislative memo by the bill's sponsors.

The bill is sponsored by Senate co-leader Jeff Klein, a Bronx Democrat, and Assemblyman Gary Pretlow, a Westchester County Democrat who chairs the Assembly racing and wagering committee.

The bill grants immunity from prosecution under federal and state antitrust laws to all tracks and OTBs in the state for the scheduling of race times and dates and simulcast broadcasting.

In 2011, Cuomo vetoed a similar bill saying that New York "must exercise sparingly" its authority to let private entities be immune from state or federal laws. He said at the time that circumstances "underlying this legislation do not warrant the exercise of that extraordinary power nor would the exercise of that power serve the public interest."

Two things have changed since that veto, however. For starters, the state is now directly in the business of running a racing operation since it took over the temporary control of the New York Racing Association and its three tracks might benefit from the bill's passage.

Moreover, the bill's sponsors have amended the bill to add what they say are new protections. The previous bill vetoed by Cuomo called for only the state Gaming Commission to have the authority to approve agreements entered into by tracks and OTBs that might otherwise raise antitrust concerns. The new measure states that the New York attorney general's office must also approve the agreements.

The measure covers both coordination of race start times and contracts involving the purchase or sale of their broadcasts, simulcasts, and electronic transmissions.

Only those agreements that are shown to "promote the state's legitimate interests in advancing our local horse racing and agricultural industries would be approved," according to the legislative bill memo.

"It is arguable that some joint arrangements between competitive racetracks could pose antitrust questions. The need to preserve the state's ailing racetracks should, however, outweigh any limited anticompetitive effects of any joint marketing or horse race production agreements,' it adds.

The legislation is pending before Pretlow's racing committee and was approved Feb. 4 by the Senate racing panel without any debate.